USD/CHF is under pressure below its key resistance at 0.9925 and is consolidating on the downside. The declining 50-period moving average suggests that the pair still has potential for a further drop. The relative strength index is below its neutrality level at 50 and lacks upward momentum.
On Tuesday, U.S. stocks remained under pressure, dragged by losses in transportation, technology and financial shares. Investors also tried to assess how President Donald Trump's new policies would drive economic growth.
The U.S. dollar nose-dived as Trump's administration voiced again its preference for a weaker currency. Peter Navarro, Trump's top trade adviser, said in a newspaper interview that the under-valued euro gives Germany an edge over the U.S. and its European Union partners. Later, at the end of a meeting with top drug-firm executives, Trump criticized China and Japan for taking advantage of the U.S. by devaluing their currencies.
Additionally, the upward potential should be limited by its key resistance at 0.9925. As long as this key level holds on the upside, look for a further downside to 0.9880 and even 0.9865 in extension.
Resistance levels: 0.9965, 1.000, 1.0015
Support levels: 0.9860, 0.9860, 0.9815
The material has been provided by InstaForex Company - www.instaforex.com
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